The risk that investors take when shelling out funds for startups is never a joke.
Such is the case for Snapchat’s earliest investors. Lightspeed Venture Partners was the first venture capital firm that invested in Snapchat, which today makes headlines after Snap Inc., its parent company, filed a $3 billion IPO last week.
Snap Inc. is slated for it’s market debut in March. By that time, Lightspeed’s Jeremy Liew can expect money to flow in thanks to the decision he made a few years back.
According to Business Insider, Liew first found Snapchat when it had less than 100,000 installs. His VC partner saw it on the phone of his daughter, who claimed that high schoolers only used three apps at the time: Angry Birds, Instagram and Snapchat.
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From that moment, Liew began his quest to learn more about the app and the people behind it. He started searching on Google and found the company website and its LinkedIn profile.
Liew sent messages to the available contact information but received no response. When he found that a certain Toyopa Group was behind Snapchat.com, he went back to Google and located Evan Spiegel on Facebook.
Spiegel finally replied to Liew’s message, and in a later meeting, discussed how Snapchat makes a difference. Spiegel also revealed the reason why he ignored Liew’s previous messages but not the Facebook invite:
“It was because you had President Obama in your [Facebook] profile picture.”
Spiegel soon let Lightspeed invest in Snapchat as a sole investor in a $485,000 seed round raised in May 2012.
Now, Lightspeed owns a large chunk of the image messaging platform, and with a looming IPO valuation expected to be between $20-25 billion, it’s easy to tell Liew struck gold with the 5-year-old company.
